Modern slavery still a force in U.K.

While the United Kingdom may be at the forefront of trying to stamp out slavery and other forms of forced labour, a report by the country’s anti-slavery enforcement agency has found that exploitation and abuse of workers is widespread across the U.K. economy, with a wide range of industrial sectors being prone to the mistreatment of employees.

Ranging from wages theft to slavery, the United Kingdom’s Gangmasters and Labour Abuse Authority (GLAA) has identified agriculture, construction, hotels, food and catering, and warehouse work as among some of the key areas that are prone to using slave labour.

The report, The Nature and Scale of Labour Exploitation Across All Sectors Within The United Kingdom, found that victims of labour exploitation are most commonly Vietnamese and Albanian. But British citizens come third: In fact, the number of British victims increased by 362 percent last year with 393 referrals, compared with 130 in 2015 and 2016 combined.

The GLAA found that forced labour accounts for around 30 percent of all exploitation, with the majority of victims being male EU nationals from Bulgaria, Czech Republic, Estonia, Poland, Romania, and Slovakia—people who already have the right to travel freely and work in the United Kingdom, but whose lack of English language skills and fear of bureaucracy put them at risk.

The agency also reports that criminals are increasingly using “debt bondage” as a way of exploiting workers, where victims are forced to work off debts they have no control over, such as travel, accommodation, recruitment, and other (often unspecified) fees. Furthermore, gangs are more commonly using social media and apps like FaceTime and Skype to recruit workers—very often for jobs that do not exist. Once these workers arrive, they are then employed elsewhere and are forced to pay extra fees and/or incur additional debts to secure alternative work.

The GLAA is unsure what the impact of Brexit might have on the numbers of people being trafficked into the United Kingdom or exploited through bonded or forced labour once they are here.

The report also highlights a number of trends that organisations should be aware of. One involves gangs encouraging workers to set themselves up as being self-employed—even in low-skilled jobs such as fruit-picking, flower picking, and cleaning, rather than be hired directly. As directors of their own businesses, these workers are given a “contract for services” and are often provided with personal bank accounts set up—and controlled by—bogus recruiters and criminal gangs.

Another trend involves agencies and individuals posing as potential employees applying for work, and setting up false e-mail accounts so that they can organise and control peoples’ contracts and other documentation, as well as charge additional fees. The GLAA also reports that some exploiters are providing workers with “One Pay” cash cards instead of opening bank accounts. This may be a way of circumventing payment of tax and National Insurance, evidence of which is required to open a bank account. There are also reports of workers being paid by “E-Card” where funds are accessed via log-in details sent by e-mail, and which can be controlled by the exploiter. A new banking system called ‘’Pockit” is also being increasingly used for the same purpose.

Seasonal and low-paid unskilled work, where there can be a high turnover of staff, are particularly ripe for cases of exploited labour, says the GLAA. And while these sectors may be regarded as “high risk” for slavery abuses, they are also the most difficult to monitor.

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Victims of modern slavery and labour exploitation aren’t necessarily easy to spot. But since the introduction of the Modern Slavery Act, the GLAA, lawyers, human rights groups, and other experts have provided a lot of useful advice to help companies determine whether there might be incidences of slavery in their supply chains or workforce.This includes:1. Companies should check if a supplier is undercutting their nearest rivals, and by what margin. If the cost looks too low, the company should assume that forced or child labour is being used somewhere in the process.2. Companies should be wary if the supplier refuses to agree to on-site audits, refuses to provide details of its suppliers or sub-contractors, or does not allow unionised labour.3. Ensure your organisation has a “top down” commitment to tackling modern slavery. Establish—and communicate—a code of conduct for staff and suppliers alike, and issue guidance/provide training so that people can identify “tell-tale” signs, and know how to report potential incidents and take action.4. Analyse the industry sector and assess its risk factors—some industries are more prone to labour exploitation than others. For example, the most common instances of people being trafficked into forced labour occur in industries such as agriculture, construction, hospitality, and manufacturing. Consider the overall risk profile of your industry, then tailor your response and due diligence accordingly to the high and medium risk areas identified.5. Make sure that your contracts with suppliers include strong contractual rights, including rights to visit a supplier’s facilities on an independent and unannounced basis. Ensure that you restrict sub-contracting of work to known and identifiable sub-contractors and that audit and visit rights extend to these entities.—Neil Hodge

For example, one-third of U.K. garment manufacturing is based in Leicester, an industrial city based in the country’s Midlands about 100 miles north of London. But up to 75 percent of workers in the city’s textile factories are said to be paid less than the legal minimum wage. The GLAA report says in some places more than half the workforce is made up of undocumented workers (predominantly Pakistani and Romanian) mainly doing night shifts. Earlier this year, the U.K. government revealed plans to provide local councils with new powers to shut down British sweatshops, but experts point out that such powers are only effective if local authorities have the resources to put them to use—and in an age of austerity, they don’t.

Convoluted supply chains and sub-contracting also make it easier to disguise labour abuses. The U.K. construction sector, employing about 3 million workers, is deemed “high-risk,” and the GLAA says the widespread use of self-employment contracts is directly linked to exploitation. Gangmasters operating in the United Kingdom are also moving workers around internationally to meet shifting demand on building sites, it says, which makes identifying potential exploitation and ending illegal practices “challenging.”

In October 2017, the GLAA produced a protocol—signed by major construction companies, including BRE Group and the now-defunct Carillion—aimed at eradicating slavery and labour exploitation in the sector. The protocol commits signatories to work in partnership to protect vulnerable and exploited workers, agrees to the sharing of information to help stop or prevent exploitation, and pledges to raise awareness of slavery through supply chains within the sector. It is too early to say whether it is proving popular or successful.

The GLAA is a new regulator; it was only given police-style powers in May last year with a remit to tackle exploitation across the entire U.K. labour market. It is also small, with a staff of around 125 people nationwide. Its work is, however, beginning to have an impact: During its first 12 months in operation, the GLAA has arrested 107 people, identified 1,335 abused workers, launched 181 investigations, and inspected 245 businesses.

In January 2016, the GLAA became the first U.K. law enforcement agency to use new powers under the Modern Slavery Act to secure a Slavery and Trafficking Prevention Order (STPO) for labour exploitation. Judges can use such orders when they feel that there is a significant risk that defendants might re-offend.

The agency used other new powers for the first time in April—called Labour Market Enforcement Undertakings, or LMEUs, granted to it in November 2016 as part of the Immigration Act—to prevent a Romanian couple living in the West Midlands from attempting to supply nine Romanian workers to an employment agency without a licence.

But prosecutions for modern slavery offences are rare, and there are even fewer successful convictions—the most recent being in February, when a gangmaster who brought Eastern European workers to the United Kingdom to work in a food-processing factory for nearly a quarter of the minimum wage was jailed for five years.

While investigations and enforcement may be difficult, evidence suggests that companies may not have embraced their legal obligations to report on slavery risks quite as readily as hoped. Section 54 of the U.K. Modern Slavery Act 2015, which came into effect in April 2016, requires large companies with a turnover of £36m or more to report on what (if anything) they are doing to address slavery and trafficking in their supply chains.

Despite some encouraging positive change since the legislation came into force, the U.K.’s Anti-Slavery Commissioner, responsible for leading efforts to tackle modern slavery and human trafficking, reported that 2016’s corporate modern slavery statements were “patchy in quality,” with some companies failing to produce them at all and others demonstrating little meaningful engagement with the issues.

In fact, the Commissioner found that many businesses were still failing to meet the three basic requirements stipulated in the Modern Slavery Act regarding their annual statements: that slavery statements were signed by the board and a director and were published on the company’s Website. The Business & Human Rights Resource Centre (BHRRC) also found that a “significant proportion” of the FTSE 100 had failed to meet these three basic elements, prompting the Commissioner to write to 25 companies that they were non-compliant and “to encourage improved efforts in the coming year.”

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The United States is the world’s largest importer of goods at risk of being produced through modern slavery among G20 countries, followed by Japan, Germany, the United Kingdom, and France, according to the 2018 Global Slavery Index.